President Abdul Kalam made strong observations about the “dubious and undemocratic” political practices prevalent.  He rightly said, “When politics degrades itself into political adventurism, the nation would be on the calamitous road to inevitable disaster and ruination.  Let us not risk it”.

Justice PB Sawant too recently made a few caustic comments in his enquiry report submitted to Maharashtra government. He said, “A tribe is growing fast which looks upon the public office as a source of pelf and power…  They have come to believe that they are above law”.  He also described as  “perverse and dangerous” the theory doing the rounds for the past few years that corruption needs to be condoned to some extent as elections involve huge expenditure.

Both President Kalam and Justice Sawant are right. But if we stop with those pious homilies, we would be no closer to resolving our governance crisis.  We need to examine the political economy of corruption, and understand the nature of incentives and compulsions in politics.  It would be dangerous to believe that politicians are a different breed of people, and their perfidy and villainy are the causes of our problems.  Such an analysis is in fact counterproductive: it repels the best in the country from politics; it does not give us levers to change political behaviour through new incentives; and it leads to greater cynicism and despair, promotes anti-political attitudes, and encourages a search for non-political solutions.

Blaming the people will not do either.  What can people do in the face of the perverse rules of the political game?  In Goa, after years of instability, they elected a stable government.  And yet legislators resigned their office, converting a majority into minority, and were rewarded with plum ministerial offices in the new government!  In Jharkhand, much of the attention was focused on the Governor’s action, and who should form the government.  Mr.Arjun Munda finally won the battle, but had to form the first cabinet with five independent legislators, and none else!  In such a situation, it hardly matters which combine is in power.  Nor can we blame Arjun Munda or Shibu Soren, who are mere victims of a vicious cycle than villains.   In Bihar, against all conventional wisdom, people rejected economic stagnation and caste rigidity.  But LJP, which emerged as the king maker, has more criminals as legislators than others!  In such a case, whoever wins, the people have lost.  In Haryana, people gave thumping mandate to Congress Party, and a clean politician became the Chief Minister.  But Bhajan Lal’s revolt almost precipitated a crisis, and he was rewarded with a cabinet berth and a possible Deputy Chief Ministership for his son and he is tipped to be a Governor!

Justice Sawant rightly condemned the tendency to condone corruption on grounds of escalating election costs.  But we need to critically examine the process of power to find answers.  It is undesirable that vast amounts are spent on elections.  Some estimates suggest that in a cycle of five years, about Rs 8000 crore is spent for Lok Sabha and State Assembly elections.  In several states, expenditure of Rs one crore or more by major candidates for an Assembly election no longer causes surprise.  In many cases – Saidapet byelection in Tamilnadu, and Kanakapura Lok Sabha byelecton in Karnataka – the expenditure is astronomical.  Even in poverty-ridden Bihar, Rs 2 to 3 crore expenditure by Lok Sabha candidates is pretty common.

Such large expenditure needs multiple returns to sustain the system. The interest, return on investment, risk premium, provisioning for next election, and building a family fortune – all these mean political corruption amounting to ten times the investment over five years.  Transfers and postings, contracts and tenders, crime investigation and prosecution – all become playthings of politics in this vicious cycle of election costs, misgovernance and corruption.

Much of the election expenditure is illegitimate and unaccounted – for vote buying, bribing officials and hiring hoodlums.  Mercenary  attitude of cynical party ‘workers’, who have no illusions about what power is about, also contributes to huge expenditure.  Clearly, this problem cannot be addressed by campaign finance reform alone.  In fact, the 2003 amendments to election and other related laws are extremely positive and progressive.  The loopholes under law were plugged (Section 77 of RP Act), all individual and corporate contributions have been incentivised by tax exemptions, and free air time in public and private electronic media is provided by law.  The last one is yet to be implemented (rules are not framed), but it is a giant step which most countries (including US) could not take despite decades of effort.

As several people, including the PM, have argued, there is a case for direct public funding of parties. And elegant models are available. But all this does not change the electoral reality much, because the incentives in politics are unaltered.

Let us face it. Politics has now become big business. The dependence on marginal vote to win a constituency in our first-past-the-post (FPTP) system means that parties rely on political bosses with money bags (often illgotten through political patronage and corruption), caste clout, family connections and increasingly, muscle power. Decent politicians employing fair means have very little chance of being elected, given the definition of victory in FPTP system. No wonder, some of the best talent has to come from Rajya Sabha. A Manmohan Singh or Arun Jaitley is unelectable whereas a Pappu Yadav or Arun Gawli is an electoral asset! In such a situation, elections may change governments, but not governance. If a Chief Minister tries to give clean administration, he will invite the wrath of legislators who seek their pound of flesh.

 We need to address three questions: how do we create conditions for the best to be elected through fair means?  How can survival in power be compatible with honesty?  How can delivery be improved through competence and probity? The answers lie in changing incentives in politics and redefining victory. For instance,  proportional representation with adequate thresholds to prevent political fragmentation will radically alter the nature of power game, and bring probity and competence into government. Direct election of the leader of government in States will eliminate instability, misgovernance and arbitrary exercise of power.

We all know that politics can no longer be run as business as usual. We need real legitimacy combined with competence in delivery, fair representation, and probity. To achieve these we need to alter the political incentives and change the rules of the game. Politicians–bashing is nice as a spectator–sport, but wisdom lies in looking at practical, systemic solutions.